Key tips for companies facing a request to access its register of members

Understanding the rules regulating how a company must respond to requests to access its register of members is important to ensure that the company does not provide more information than is required or permitted. 

Summary

A company must ensure it has its register of members ready at the appropriate location (usually the registered office) should it receive a request for inspection.  Public companies must ensure their registered office is open to the public for this purpose. 

A copy of a register of members provided in response to a request must contain all the information that is kept in the company’s register (other than share certificate numbers, which companies are not required to provide), even if this information goes beyond what is required to be kept in the register at law.  As such, we recommend that companies store members’ email addresses and telephone numbers in a separate database and do not include this information in their register of members.

Further, a company that receives a request for a copy of its register of members must comply with the request provided it is in accordance with the law (including that the reason for making the request is not prohibited).  This means that a company must comply with a request even if the company may not agree with the underlying agenda behind the request.  Conversely, a company must not comply with a request for a copy of its register of members if the applicant has provided a reason for making the request that is prohibited. Companies and individuals can face monetary penalties for failing to comply with these obligations. 

Legislative framework

The Corporations Act 2001 (Cth) (Corporations Act) sets out rules relating to a company’s register of members, including how a person can seek to access it.¹  There are three main ways in which this can take place. 

Firstly, the person could seek to inspect the register of members under subsection 173(1).  If the person is a member of the company, they may inspect the register without charge.²  Other persons may inspect the register only on payment of any fee required by the company up to the following maximum amounts:³

1. if the register is not kept on a computer – $5.00 for each inspection; and
2. if the register is kept on a computer – a reasonable amount that does not exceed the marginal cost to the company of providing an inspection.

Provided the person is prepared to pay the fees set out above, the company is obliged to allow the person to inspect the register of members when an application is made under subsection 173(1).

Secondly, a person may apply to the company for a copy of its register of members under subsection 173(3).  A company must give the person a copy of the register (or a part of the register) within seven days (or such longer period as ASIC allows) if the person:

1. makes an application which states the name and address of the person and each purpose for which the person is accessing the copy, and none of these purposes is a “prescribed purpose” (ie a Prohibited Purpose).⁴  The Prohibited Purposes are set out in the Corporations Regulations 2001 (Cth)⁵ (Corporations Regulations) (see below); and
2. pays any fee required by the company up to the following maximum amounts:⁶
   • $250; plus
   • $0.05 for each member about whom information is provided in excess of 5,000 members and up to 19,999 members; and
   • $0.01 for each member about whom information is provided at 20,000 members or more.

The following are Prohibited Purposes for seeking a copy of a company’s register of members:⁷

• soliciting a donation from a member of the company;
• soliciting a member of the company by a person who is authorised to assume or use the word “stockbroker” or “sharebroker” in accordance with section 923B of the Corporations Act;
• gathering information about the personal wealth of a member of a company;
• making an offer that satisfies paragraphs 1019D(1)(a)-(d) of the Corporations Act (which relate to unsolicited offers to purchase financial products); and
• making an invitation that, were it an offer to purchase a financial product, would be an offer that satisfies paragraphs 1019D(1)(a)-(d) of the Corporations Act.

Provided the criteria set out above is met, the company is obliged to provide the person with a copy of the register of members when an application is made under subsection 173(3).

Lastly, a member of a company may apply to a court for an order under section 247A⁸ authorising the applicant, or a person acting on their behalf, to inspect the “books” of the company (the definition of which includes a register of members⁹).  The court may make the order if it is satisfied that the applicant is acting in good faith and for a proper purpose.¹⁰  The focus of this provision is “scrutiny of the company’s own activities and its own records”, which will ultimately inform what is a proper purpose.¹¹  For example, seeking documents to protect the member’s investment in the company would be a proper purpose while seeking to support a proposed takeover bid would not be a proper purpose.¹² 

If an order is made, then the applicant may make copies of the register unless the court orders otherwise.¹³  The court may also make ancillary orders under section 247B, including orders limiting the use that the applicant may make of information obtained during the inspection or limiting the right of the applicant to make copies of the register.

In cases where a member is seeking access to a register of members under section 247A, it is common for them to also seek access to other company documents (for example, proxy forms received by the company ahead of a general meeting of members).¹⁴  In circumstances where a member is only seeking to access the register of members and no other document, the provisions of section 173 are simpler and therefore more likely to be utilised.  For these reasons, the rest of this article will focus on the provisions of section 173.

Key tips for companies

Be prepared for a request to inspect a register of members

The Corporations Act contains a number of obligations in relation to the register of members beyond its contents.  Complying with these obligations will ensure the company is in a position to allow a person to inspect the register should it receive such a request.

A register of members must be available for inspection at the place where it is required to be kept and during the times when the registered office of the company is required to be open to the public.¹⁵  For a public company, this is:¹⁶

• from at least 10 am to 12 noon and from at least 2 pm to 4 pm on each business day; or
• for at least three hours between 9 am and 5 pm on each business day.

A company must keep its register of members at:¹⁷

• its registered office;
• its principal place of business in Australia;
• a place in Australia (whether of the company or of someone else) where the work involved in maintaining the register is done.  For example, this could be the office of a share registry provider that the company has engaged to maintain its register of members; or
• another place in Australia approved by ASIC.

If a company keeps it register of members on a computer, a person may inspect the register at the company’s registered office at any time when the registered office is required to be open to the public.¹⁸ 

Do not provide access to a register of members if a Prohibited Purpose is given

It is an offence to use information about a person obtained from a register of members:

1. to contact or send material to the person, or disclose the information knowing that the information is likely to be used to contact or send material to the person, unless the use of information is relevant to the holding of the interests recorded in the register of members or the exercise of the rights attaching to them.¹⁹  This means that a person could obtain a register of members for the purpose of, for example, soliciting votes from members in a director election; or
2. for any of the Prohibited Purposes set out above, or disclose the information knowing that the information is likely to be used for a Prohibited Purpose.²⁰ 

Companies should therefore ensure they do not provide access to a register of members if the person requesting the copy is seeking that access for a Prohibited Purpose or to contact or send material to members that is not relevant to their shareholding or membership interests.  If a company knowingly provides its register of members to a person in these circumstances, the company (and those involved in the contravention) commit an offence of strict liability which is punishable by:²¹

1. for a natural person – a fine of up to 50 penalty units.  At the time of writing, this equates to $11,100; and
2. for the company – a fine of up to 500 penalty units.  At the time of writing, this equates to $111,000.

Comply with an application given in accordance with the Corporations Act

Once a company is satisfied that the person applying for a copy of its register of members is not doing so for a Prohibited Purpose, and the person is not likely to contact or send material to members that is not relevant to their shareholding or membership interests, the obligation to provide a copy of the register under section 173 becomes mandatory.²²  In cases in which a company has refused to provide its register of members to a person on the basis that the person had some sort of underlying agenda with which the company did not agree (and this wasn’t a Prohibited Purpose), the courts have said that the company must comply with the request to provide a copy of its register of members.²³

If a company fails to comply with a request to inspect or provide a copy of its register of members, the company (and those involved in the contravention) commit an offence of strict liability which is punishable by:²⁴

1. for a natural person – a fine of up to 30 penalty units.  At the time of writing, this equates to $6,660; and
2. for the company – a fine of up to 300 penalty units.  At the time of writing, this equates to $66,600.

Provide a copy of the register in the correct format

When providing a copy of a register of members, the register must be provided as a delimited text file:²⁵

• produced by a commercially available spreadsheet or database application; and
• copied onto a CD-ROM or a USB portable memory device.

Ensure any copy of a register of members contains all the information which the company keeps in the register

When providing a copy of a register of members, a company should ensure that the copy contains all the information that is kept in the register as maintained by the company.  This will of course include the information which is required to be included in the register under the Corporations Act, such as the name and address of each member, the date on which the entry of each member’s name was made in the register and the number of shares held by each member.²⁶ 

However, some companies may include additional information in its register of members, such as each member’s email address or telephone number, even though this information is not required under the Corporations Act.  There was a Bill in 2017²⁷ that proposed to make the inclusion of email addresses in members’ registers compulsory.  However, this Bill was not passed.

Companies should be aware that if a person requests a copy of the register of members, any additional information that the company has included in its register of members must also be provided in response to this request.  In Re Aurora Funds Management Ltd [2019] NSWSC 630, Rees J said:

“It is apparent from [regulation 2C.1.02] that the register must be provided in a usable format to permit convenient communication with a large number of members.  It also seems to me that the regulation requires that the register be provided in the form in which it is held by the responsible entity or its registry, that is, without deleting or re-formatting the information, for example, by deleting email addresses where members have provided one.  As Yates J noted in MDA National Ltd v Medical Defence Australia Ltd (No 2) (2014) 225 FCR 476; [2014] FCA 1071 at [26]–[27] , the obligation is to provide ‘all information contained in the register, not simply the information that the register, as a minimum, must contain.’” (our emphasis).²⁸

This gives rise to privacy concerns.  As such, companies should store any email addresses and telephone numbers of members that it has collected in a separate database, rather than in its register of members.

If you require any assistance in responding to a request for your company’s register of members, please contact us.

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1 Corporations Act Part 2C.1 and Part 2F.3.
2 Corporations Act subsection 173(2).
3 Corporations Regulations Schedule 4, Item 1.
4 Corporations Act paragraph 173(3)(a) and subsection 173(3A).  Note that the offences under section 137.1 or 137.2 of the Criminal Code Act 1995 (Cth) will apply where an applicant knowingly makes a false or misleading statement or produces a false or misleading document in relation to an application.
5 Regulation 2C.1.03.
6 Corporations Act paragraph 173(3)(b); Corporations Regulations Schedule 4, Item 1AA.
7 Corporations Regulations regulation 2C.1.03.
8 Members also have a common law right to access the books of the company.  In Sun Hung Kai Investment Services Limited v Metals X Limited [2019] FCA 1673 at [16], Colvin J noted that “the legislative context [of section 247A] indicates an intention to clarify common law uncertainty as to the extent of the rights of a member of a company to access the documents of the company by conferring on the Court power to allow access where it was sought for a bona fide and proper purpose”.
9 Corporations Act section 9.
10 Corporations Act subsection 247A(1).
11 Sun Hung Kai Investment Services Limited v Metals X Limited [2019] FCA 1673, [20].
12 Sun Hung Kai Investment Services Limited v Metals X Limited [2019] FCA 1673, [19] citing Intercapital Holdings Ltd v MEH Ltd (1988) 6 ACLC 1068 and Re Augold NL [1987] 2 Qd R 297.
13 Corporations Act subsection 247A(2).
14 See eg Sun Hung Kai Investment Services Limited v Metals X Limited [2019] FCA 1673 and Re Cromwell Property Securities Ltd in its capacity as responsible entity of Cromwell Diversified Property Trust and Cromwell Corp Ltd [2019] NSWSC 1608.
15 Corporations Act section 1300.  This section applies to all “books” of a company, which includes a register of members, which are required under the Corporations Act to be available for inspection.
16 Corporations Act section subsection 145(1). [17] Corporations Act subsection 172(1).
18 Corporations Act sections 1300 and 1301.
19 Corporations Act subsections 177(1) and 177(1A).
20 Corporations Act subsection 177(1AA)
21 Corporations Act subsection 177(1B), paragraphs 1311B(1)(a) and 1311C(1)(a) and Schedule 3.  The value of a penalty unit is currently $222: Crimes Act 1914 (Cth) section 4AA.
22 See eg HongKong Xinhe International Investment Co Ltd v Bullseye Mining Ltd [2020] WASC 276 at [36].
23 See eg Re Aurora Funds Management Ltd [2019] NSWSC 630 at [24].
24 Corporations Act subsection 173(9A), paragraphs 1311B(1)(a) and 1311C(1)(a) and Schedule 3.  The value of a penalty unit is currently $222: Crimes Act 1914 (Cth) section 4AA.
25 Corporations Regulations regulation 2C.1.02
26 Corporations Act section 169.
27 Corporations Amendment (Modernisation of Members Registration) Bill 2017 (Cth).
28 Re Aurora Funds Management Ltd [2019] NSWSC 630, [26].

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